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PRECIOUS-Gold eases as new coronavirus strain rattles markets

CoronavirusDec 21, 2020 20:12
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(Updates prices)
* Silver touches a more than 3-month peak
* Dollar hits over one-week high, off multi-year lows
* Interactive graphic tracking global spread of coronavirus:

By Shreyansi Singh
Dec 21 (Reuters) - Gold edged down on Monday as fears of a
new coronavirus strain roiled markets and investors opted for
the dollar, while the metal gained some support from a U.S.
stimulus package.
Spot gold XAU= fell 0.2% to $1,877.83 per ounce by 1:44
p.m. EST (1844 GMT), having earlier hit its highest since Nov. 9
at $1,906.46. U.S. gold futures GCv1 settled down 0.3% at
"Gold market traders in general are looking at the Senate in
the U.S. and it is a foregone conclusion that this stimulus deal
that went through last night is going to pass this afternoon,"
said Bob Haberkorn, senior market strategist at RJO Futures.
"Gold will trade higher as the week goes on, but today I
think traders are getting their heads around the UK strain."
Bullion had jumped more than 1% earlier in the session,
helped by reports that U.S. congressional leaders reached
agreement on a $900 billion package. But it later fell as much as 1.3% as the dollar index .DXY
rebounded off multi-year lows to an over one-week high as fears
of a highly infectious new coronavirus strain dragged the pound
and euro down. USD/
News of the strain also dented risk sentiment, leading to a
slump in European equities and Wall Street's main indexes.
.EU .N
Gold, considered a hedge against inflation, has risen about
24% this year amid the massive stimulus unleashed globally.
"Today's price action for gold reminded traders of the panic
selling that occurred in March. The prospects of more stimulus
have been driving gold higher, but today's short-term dollar
surge is disrupting that thesis," Edward Moya, senior market
analyst at OANDA, said in a note.
"Gold's bullish trend is still intact but could still be
vulnerable if the dollar comeback lasts a couple of days."
In other metals, silver XAG= rose 1.5% to $26.16 an ounce,
having hit its highest since Sept. 16 at $27.38 earlier.
Palladium XPD= fell 2.2% to $2,309.77 and platinum XPT=
dropped 2.3% to $1,012.39.

PRECIOUS-Gold eases as new coronavirus strain rattles markets

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